Earticle

초록

영어

We distinguish the valuation effects of growth opportunities and profits through a common lens, namely, corporate free cashflows (FCF) whose negative value means investments using external funds while positive value means internal funds available for payouts. The sign of FCF’s crosssectional relation to firm value in a country (FCF beta) can show which one has a greater impact on country-wide corporate valuations. Using data from 43 countries for the period of 1992-2018, we show that firm values are higher in countries whose FCF beta is more negative—i.e., where externally funded corporate investments, not internally available corporate profits, are valued higher. The role of growth opportunities in country-wide valuations is more pronounced among growth firms. In contrast, mature firms are representative of the valuation of the global industry to which they belong, not their country. Finally, the FCF beta is more negative in common law countries than in civil law countries, suggesting that growth-supporting governance is more value-relevant than payout-securing governance at least at the country level.

목차

Abstract
Abstract
1. Introduction
2. Formulation of research question
3. Sample and data
4. Main empirical results
4.1. Country-specific corporate valuation
4.2. Country-specific FCF beta
4.3. Relation between country-specific corporate valuation and FCF beta
5. Robustness
5.1. Time-series pattern
5.2. Alternative definition of growth and mature firms
5.3. Firm-level evidence
5.4. Industry analysis
6. FCF beta and country-level governance
7. Conclusions
References

키워드

저자

• Dong Wook Lee [ Korea University Business School, Seoul, Korea ] Corresponding Author
• Lingxia Sun [ International School of Business & Finance, Sun Yat-sen University, Guangdong, China ]

참고문헌

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간행물

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• 간행물명

  한국재무학회 학술대회

• 간기

  부정기

• 수록기간

  2006~2024

• 십진분류

  KDC 325 DDC 330